Japanese gaming company GREE purchases Funzio

Tokyo-based gaming giant expands its mobile talent and games

In a bid to expand its mobile footprint, Japanese social gaming company GREE announced Tuesday that it has purchased mobile game developer Funzio.

San Francisco-based Funzio was founded in 2010 and raised $20 million in Series A funding in May 2011 from IDG Ventures in the U.S. and IDG Capital Partners in China, along with Rick Thompson, co-founder of Playdom.

Funzio has developed games such as Crime City, Modern War, and Kingdom Age, which run on both the iOS and Android operating systems. The company currently has over 20 million game downloads.

Tokyo-based GREE was founded in 2004 and currently hosts over 190 million game players and over 7,500 apps. Over 90% of its users access its games on mobile phones.

“GREE shares our vision of a mobile world where people can play together wherever and whenever they are,” Funzio founder and CEO Ken Chiu said, in the release. “We feel strongly that our experience in creating unique games for the mid-core market and GREE’s expertise in bringing the mobile games to the worldwide community is a perfect match.”

GREE’s global expansion

GREE has recently been making an effort to expand into the global market, and is especially interested in penetrating the U.S.

GREE previously purchased the gaming platform OpenFeint, based in Burlingame, CA, for $104 million in April 2011. Then, in November, it announced plans to launch a new global gaming platform to be released this year. It also revised their projected earnings up 40 to 50% after seeing their network growing at a rate of 3.8 new users per second. In 2011, GREE opened new offices in the United States, China, Korea, Singapore, UK, the Netherlands and had plans for Brazil.

In March of this year GREE launched its first U.S. created app, Zombie Jombie, a month after announcing that it was setting up a new 41,000 square foot office space in San Francisco.

In the press release, GREE says that its acquisition of Funzio will help the company achieve its ultimate goal of having one billion users worldwide “while introducing new genre expertise and exceptional titles to the anticipated GREE social mobile gaming platform, scheduled for release in Q2 2012.”

GREE’s previous purchase of OpenFeint gave them the platform to launch games, and now with the procurement of Funzio it has its U.S. developer as well. GREE has put the pieces in place to become a major player in the U.S. gaming developing industry, which should allow it to compete with some the biggest U.S. companies, like Zynga and Big Fish Games.

Zynga recently made big news when it purchased OMGPOP, the developer of Draw Something, which recently became the best selling app in the iTunes store. Zynga is also rumored to be going after game developed Glu.

Among some of the other recent gaming aquisitions are IGT's purchase of Double Down for $500 million in January. Double Down was estimated to be generating $50 million a year in revenue. In March, Big Fish Games bought Self Aware Games for an undisclosed amount.